DOF: Gov’t has time to catch up on H2 spending

MANILA – Data from the Department of Finance (DOF) showed that the government needs to catch up on its capital spending for the remaining months of the year.

For the first half of the year, capital spending – which refers to raw materials, infrastructure, and other inventories – made up for 2.84 percent of the country’s economic output. The number increased from 2014’s 2.56 percent, but still below the target of 4.4 percent.

Although the number is more than the target, the figure is still lower than expected. The 4.4 percent target was drawn against the growth goal for the year, which is 7 to 8 percent. However, the GDP only in creased by 5.3 percent as of June.

“The third and fourth quarters will be very crucial. The room to grow is large,” said Finance Undersecretary and chief economist Gil Beltran.

Over the past five years of the current administration, state expenditures have consistently lagged behind the target.

However, Beltran said that the government could still improve, especially since the revenues reach new marks last June.

According to the Finance Department’s bulletin, the country reached a GDP of 17.13 percent from last year’s 15.51 percent. It is the “highest first semester revenue effort increment achieved since 1994.”

On the other hand, tax effort came up to 14.09 percent, which is the highest since 1997. The target set for this year was at 15 percent.